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Tata Motors Speed Breakers Galore
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Tata Motors- Speed Breakers Galore
The year 2008 was considered a milestone in Tata Motors history. In early 2008, the company had unveiled a plan that was supposed to further the company’s fortunes; little did they know that the plan was the beginning of their most significant financial problems. The company had unveiled the cheapest car in the world that was going at a price of 100, 000 rupees. Tata Motors followed this with the acquisition of two other brands, the Jaguar and Land rover brands. As already mentioned, this strategy did not transform the Tata Company, as it was initially thought. This paper, hence, is an analysis of the rapid reversals of the Tata Motors’ fortunes that took place in between early 2008 and March 2009. The paper will show how the company’s fortune was affected the frozen global credit lines that affected India’s economy and that of the Indian automakers largely.
Tata Motors was started in the year 1945 under the name TELCO, Tata Engineering and Locomotive Company Limited. The company’s main aim was to manufacture products in engineering, as well as, locomotives. The company made its first commercial vehicles in 1954 when it entered into a contract with Daimler Benz AG to manufacture commercial vehicles for the company. By 1961, the company had begun manufacturing its own commercial vehicles, which were first sold to Sri Lanka. The Company set up a research center in Pune in 1977. It was in 1983 when the company manufactured its first heavy commercial vehicle. In 1985, the company collaborated with Hitachi to manufacture the first hydraulic excavator; the manufacture of the first indigenously produced automobile, the Tata 407, commenced in 1986. In the following years, the company introduced its indigenously manufactured passenger cars. In 2002, the Tata Indigo and Indica were unveiled.
The company also started selling the MG Rover; a UK brand for the manufacturing company in the UK. In 2003, the company unveiled a new name Tata Motors. In 2004, the company bought Daewoo Commercial Vehicles Company. The company continued to sign other deals with other companies like Fiat India automobiles, Fiat Group 8, and Fiat Auto. The company marketed its products in numerous countries like Kenya, Malaysia, Ukraine, Senegal, and Russia. The company attained an excellent reputation, as it began to work with prestige car manufacturers like Porsche, Chrysler and Volkswagen. The Tata team was also highly skilled and talented. The company’s goal was to establish itself as a major automobile manufacturer in India and in the international market through acquisitions and mergers. It was in this light that the company acquired the JLR from Ford.
The company’s rationale for acquiring these new brands was;
To enable the company to penetrate the luxury car and premium all terrain market,
To improve the company’s strength in the global market,
To strengthen the company’s product and technological development and innovation abilities to address issues brought about by changing trends in the market,
To share the best quality assurance and manufacturing processes and systems, to enhance the company’s managerial and human capital talent,
And to increase the company’s operational synergies
The acquisition of the British brands from the Ford Company by the Tata Motors did not transform the profits of the company as the chairman had expected. It was thought that this overturn of events was triggered by the global financial crisis that caused the demand of automobiles to decrease. The decreased demand impacted Tata Motors, business wise, and especially when it came to the success of the newly acquired brands. The picture that the financial position of the company presented at the end of the financial year also gave little hope. It was during this financial year that the company had reported its first loss in more than 8 years. As compared to the last year’s profit of about Rs. 741. 51 billion, the company’s loss in 2008 f 25. 05 billion rupees was tremendous.
The situation continued into the next financial year’s first quarter. In June 2009, the company reported that had acquired a net loss of 3. 29 billion rupees on the 169. 54 billion rupees of revenue it had acquired in the first quarter of the 2009 financial year. The company thought that this loss had been attributed by the fallen sales of the newly acquired brands, whose volume in sales had decreased by 52 percent when compared to those acquired in the previous year. The loss that the JLR brands registered alone was put at 8.73 billion rupees, with the main markets for the brands decreasing significantly.
While the company suffered from these unexpected losses, it also reeled under the huge burden of the large debt it had acquired during the acquisition of the JLR. The total loan was about 3 billion US dollars, and the company had only managed to pay 2 thirds of the loan. The plans of the company to secure funds to refinance this loan had been ruined by the financial crisis. This was because the company’s share price had significantly dropped causing the failure of the rights issues that was supposed to secure enough funds for refinancing the loans. Eventually, the promoters had to subscribe since other shareholders shied away from the rights issues. Later, the company had to raise the required finances through schemes on fixed deposit that were issued to the public and offered to the private placement of NCDs, non- convertible debentures, at an interest rate that was high.
The company also faced serious setbacks with the Nano. The company experienced challenges in launching the new car when the farmers around the manufacturing plant of the Nano brought forth complications which made the company move its plant to another area. The agitation was supported by some political forces, and it was difficult to ignore the agitation. The company, thus, experienced delays in the launch of the new car, as it would take some longer time, about a year, to launch the car from the new location. Further some industry experts expressed doubts on the success and profitability of the launch. They were concerned that the company, with the current issues in finance, was not in a position to manufacture and sell such large volumes.
As it was, the company’s chairman had a tough task of making Tata Motors profitable once more. The company had three main challenges to address; they had to turn the performance of the new brands around, the company also had to refinance the remaining loan, and it had to make the Nano project successful and profitable.
What did the problems the company was facing mean? It was thought that the company had made a bad move in acquiring two new brands at a time when the financial crisis had affected much of the spending capabilities of customers all over the world. Credit availability was, therefore, significantly affected, and the price of credit also increased. As a result, the demand for automobiles was affected, and it plummeted considerably across the world. This, in turn, largely affected the finances and operations of the company, and specifically the performances of the newly acquired brands.
The decreased sale volumes of the JLR also caused the company considerable amount of problems. By September of 2008, the total sales of the new brands dropped by about 11.4 percent as compared to the sales volumes of the previous year. The land rover was shown to have fallen sales of not less than 19.1 percent. The sales volume of Jaguar, however, increased by 17.5 percent. The company’s anticipation that the new brands would generate enough capital for the company to finance internal working capital was not realized. The company had to acquire funds from external sources in forms of loans. The company also had to cut workers. Others were given compulsory leave with a percentage of their salaries. The company’s troubles with finance did not make the matters any easier. The company had raised a total of 3 billion dollars in loan during the acquisition of the JLR. The company was struggling to make payments of the loan as it had launched a rights issue that failed to pick. In the end, the promoters of the issues had to bid on it as the shareholders did not respond well to the offer.
Conclusion
By mid 2009, the financial position of the company had deteriorated so much that the company had cut and dropped numerous workers to make ends meet. All in all, the chairman expressed great optimism that the company would recover in time.
Summary of Shakespeare in the Bush by Laura Bohannan
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Summary of Shakespeare in the Bush by Laura Bohannan
The author is an American anthropologist who visits an African tribe named the Tiv. During her visit, she takes a copy of Shakespeare’s book the Hamlet with to prove that the points illustrated in the book are universal and that anyone can understand them with a little help. The tribe she visits spends a lot of their time narrating stories and drinking, something, which is according to their culture. The author is, as well, supposed to narrate stories, but she is nervous about narrating the Hamlet story to them despite the fact that the tribe is exceedingly eager to hear the stories. While telling the story, they keep on interrupting her because they think they know the meaning of the story more than she does. To them, it is hard to understand certain concepts like drowning because water to them is good, and they only know of zombies not ghosts. The point of the book is that the story in Hamlet loses its meaning in Africa because of the different points of view they have of the central concepts. The author later learns that values and concepts are not universal as different cultures have different interpretations to different concepts according to the values they hold (Bohannan 28- 33).
Summary of Japanese Mothers and Obentos by Anne Allison
In this article, Anne talks of the importance and culture of the obento, which has its origins in Japan. She spent a year making obentos for her son while in Japan and through this she learned a lot about the social rules and structure of the Japanese. An obento is a small lunchbox made for preschool children by their mothers every day. It is made with variety and creativity. The mothers put a lot of care and artistic element into these obentos. In a culture where obedience and structure is observed, the teacher of the child then scrutinizes the obento, and their success in school depends on their ability to finish their obento cleanly and quickly. Each obento is constructed with each part apart from others and with excellent balance. The emphasis on the design emphasizes on the presence of food’s nature. The obento, therefore, is extremely crucial, as a way to prepare the children to do well in school (Allison 195- 208).
What is the political issue about space in the Nationalist Rhetoric of the Hellenic Republic and The Republic of Macedonia?
Since the end of the roman era, Macedonia was never identified with constant and specific geographical and administrative borders. It was only later in the nineteenth century when the title Macedonia was used to refer to the region of three Ottoman provinces. By this time, the area had become a cause of disagreement among numerous nationalities of the Balkan origin. Nations were fighting to take over this area and expand its borders for economic success and political powers. By early twentieth century, the term Macedonia was broadly accepted as the geographical indication for the area, which more or less was comprised of the three Ottoman provinces. During this time, Macedonia did not have an administrative or an ethnic connotation, but a geographical one. This situation made it possible for others to try to take this space away from the original dwellers. As a result, of the 1912- 13 Balkan wars, the area became liberated from Ottoman leadership. The three allies who had fought for this liberation shared parts of the area (Peckham 59- 67).
What are the political implications of space for indigenous people?
In a study carried out in 2008, Ajala observed that space performs four main roles in indigenous communities: communication, consumption, settlement and security. All these functions, according to the study are commonly shown in the political values usually related to space. He further argued that construction of space is different in different cultures. As it follows, the different perspectives on space are based on the attitude of a group to space, access to that space and their interaction with the space as a resource of political dominance and power. The concept of space plays a crucial role in negotiations of power and decision (Alfred 34- 45).
In socio- political organizations, space is established in a categorization of women and men in a socio- political structure, which has effects and influences on their access to power. In this case, it is conceptualized as the method of claiming power or a right to make decisions, or question the resolutions and decisions that have the potential to exclude the group or individual or affect their life. Power gives an individual or a group the ability to cause others to obey and do as directed by the individual. Power can be exercised through a number of ways. In an indigenous society, therefore, power obtained from space can mean that the indigenous people will do as directed by their political leaders to maintain their space and its four functions (Alfred 34- 45).
Explain how time can be a cosmology and what is a cosmology?
In anthropology a cosmology is a construct of analysis, as well as, an object of study that can be defined as a set of beliefs, knowledge, practices and interpretations of a culture or society related to explanations about the evolution and origins of the universe and the meaning and role of life, human and the world within the cosmos. A cosmology, therefore, includes an explanation of the past, future and present of a culture and these explanations are part of comprehending the cosmo-eco-ethnogenesis, and it has to do with the origins and the destiny, as well as, the finality of humans and other existence forms. In anthropology cosmology, therefore, is used to mean the set of beliefs, knowledge, practices and interpretations and the set of overarching behavioral templates and cognitive templates, which are transformed and utilized by a society to understand, interpret and explain its functions and roles within the world, life and the general cosmos (Reichel-Dolmatoff 307- 18).
Using these definitions of cosmology one can argue that time can be a cosmology. This is because time can be taken as an analytical construct or an object of study when it comes to studying different periods of the human society from the evolution periods to the modern times. Time can be used to explain the different practices of a society and their periods, and how they relate to different trends in the human history. As it follows, time is a cosmology as it can be studied like other analytical constructs in anthropology (Reichel-Dolmatoff 307- 18).
Work cited
Alfred, T. Peace Power Righteousness: An Indigenous Manifesto. Oxford University Press, 1999. Print.
Allison, A. ‘Japanese Mothers and Obentos: The Lunch-Box as Ideological State Apparatus’.Anthropological Quarterly, 64. 4 (1991):195-208. Print.
Bohannan, L. ‘Shakespeare in the Bush. An American anthropologist set out to study the Tiv of West Africa and was taught the true meaning of Hamlet’. Natural History 75 (1996): 28–33. Print.
Peckham, S. National histories, natural states: Nationalism and the politics of place in Greece. London: I.B. Tauris, 2001. Print.
Reichel-Dolmatoff, Gerardo. ‘Cosmology as Ecological Analysis: A View from the Rainforest. The Huxley Memorial Lecture’. MAN. 11.3 (1976): 307-18. Print.
Rodrick, Dani 2011 The Globalization Paradox Democracy and the Future of the World Economy
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Rodrick, Dani 2011 “The Globalization Paradox: Democracy and the Future of the World Economy”
The research question of the work of the author revolves around the paradox of globalization. He argues that the ultimate globalization paradox is that which works best when pushed slightly. According to the author, individuals must witness the new arrangements in global economies that are based on deliberation of the populations where it is present, and that is within nations. The author argues that economists have, for years, driven forward the globalization cause in financial institutions, trade and labor markets. Yet, consistent warning signs have indicated that this might not always be beneficial. Although globalization of the economy has driven unprecedented prosperity levels in developed countries, and is not beneficial at all for millions of poorly paid workers in Asia the author shows the concept to be unstable and resting on shaky pillars. The main argument of the author is that nations cannot pursue democracy simultaneously, economic globalization and national self- determination. He argues that protectionism will result if we allow governments too much power, and that unstable economy of the world with little political and social support will result if we give too much freedom to the markets. His main arguments are not for maximum globalization but smart globalization.
There are a number of variables that the author uses to argue his point. There are both independent and dependent variables. An example of a dependent variable in the text is markets. He argues that markets have to be coterminous with the institutions of regulation and governance that govern them. The market is, therefore, dependent on such things as governance and regulation. It is also dependent on the scope of workable. He emphasizes that markets are institutions that need support of other institutions that are non- market. His argument is that any type of long- distance market needs a non- market organization to develop it. Markets are not self- regulating, self- creating, not self- stabilizing and not self- legitimizing.
In this case, the author shows governance as an independent variable. He argues that the main idea behind legitimate governance today is the notion of the nation state. The modes and institutions of governance are independent because they are the ones that influence other variables like markets. Globalization is another notion in the text that a reader can take as an independent variable. It is an independent variable because, just like governance, it regulates and limits certain functions in the nation state, trade, and rules and regulations governing trade.
Rodrik’s hypothesis seems to be that hyperglobalization is today’s enemy of the world, and that nations have to address it to promote social concerns diversity across all of the world’s democracies. His conclusions are that we have to contend with an economy of the world that is a patchwork when it comes to governance. He argues that we run the risk of running into two risks if we do not get this balance right. The risk of legitimacy deficit is one possible risk if we push global rules too much. Instability and inefficiency is another possible risk that might occur if we push global markets too far. He concludes that recognizing and acknowledging the centrality of the nation is more likely to lead to an economy of the world that is healthy than trying to damage it.
The text is based on both qualitative and quantitative data to examine the social global and national trends that determine the paradox of globalization. The author, for example, carries out a number of surveys from which he derives a number of quantitative and qualitative data, which he uses to support and base his central arguments. The evidence plays a big role in his formulation of the main arguments he makes about globalization, governance, and several other trends in several state nations.
In presenting their ideas, the author is able to bring forth a number of theoretical frameworks. Some of these include globalization, institutionalism and liberalism. In the text, he criticizes globalization enthusiasts who are unalloyed, particularly focusing on their desire to liberalize capital movements and foreign trade fully. While acknowledging and showing the fact that extensive engagement with the economy of the world can lead to raised material living standards, the author worries that the unintended impacts might lead to unnecessary and even unwanted social distress. He is also not so happy about by the empirical casualness of the points and arguments advanced in liberalization support. He argues that there are numerous ways to development, and societies that are democratic should be freed to practice their collective preferences without having the policy and institutional preferences of outsiders imposed on them.
Unfortunately, the author does not apply the same thoroughness and scrutiny to how democracies make their decisions, which he does to the other arguments in the book like the one that concerns different ways to the development. He also argues that, as a forecaster, he is limited. He is unable to predict a number of financial crises. It also seems that the author is on unfamiliar grounds when discussing international finance. In conclusion, the author gives a number of recommendations. For instance, he points out that state nations should focus on global rules that improve their domestic deliberation quality. Further, he advises that state nations should legitimize national disparities in regulatory bodies, subject to safeguards of procedures that ensure deliberation that is high- quality.
Work cited
Rodrick, Dani. The Globalization Paradox: Democracy and the Future of the World Economy. W. W. Norton & Co., 2011. Print.